Transcript of "NZC - Maxwell"

2.
What Makes Water Unique?
2
 Water is our most essential life-sustaining substance
 Water is the most critical input to the world’s economy
 The amount of water on the earth is essentially fixed
 Water is the only commodity that truly has no substitute –
at any price
 Demand for water has dramatically increased as the planet’s
population has increased
 As standards of living increase, per capita consumption of
water also increases
 As water resources become scarcer, political conflicts are
likely to arise

3.
Background and Context
3
 2.5 billion people live without any kind of sanitation system
 95% of the world's cities dump sewage into natural waterways
 Over 10 million children die each year from drinking dirty water
 Millions in the U.S. drink water that doesn’t comply with SDWA
 The ASCE recently gave U.S. water infrastructure a “D-” rating
 Incipient climate change will accelerate or intensify
many of the water challenges and issues that we already
face
 Public awareness is growing, but more attention and
more dollars are critically needed – challenges are still
not widely recognized

4.
Water Shortages Are Upon Us
4
We are experiencing rapid – and often
irreversible – depletion of aquifers and
natural wetlands
50% of the world’s people are
projected to be living with chronic
water stress by the year 2050

6.
The Bare Facts
6
- The Supply of Fresh Water
on Earth is Essentially Fixed
- The Earth’s Population and
Its Demand for Freshwater
is Rapidly Growing
- Water Use Has Been
Growing At More Than
Twice the Rate of
Population Increase
Over the past Century
IT’S ABOUT THAT SIMPLE

9.
The Future of Water: Four Key Themes
10

1) Water will increasingly be viewed as a true
“factor of production”

2) Water consumption will increasingly be
viewed in a more holistic manner

3) Boundaries between different types of
waters will fade

4) The price of water will inexorably rise –
reflecting its true cost and true value (and
reinforcing all three key trends above)

10.
Water as a “Factor of Production”
11

Water will increasingly be viewed as
a true “factor of production” – much
like energy, labor or capital – in
economic, business, policy and
individual decision making

As water becomes more expensive, it
will increasingly drive economic,
and individual, decisions

Availability of abundant clean water will drive the
location of industry in the future
Will
cities like Cleveland and Buffalo again be our centers of
manufacturing and population growth in the future?

11.
A More Holistic View of Water
12

We only directly utilize some 50 to
300 gallons per day of water

But we consume far more water
contained in the products and
services that we consume, and the
various activities we engage in

We must also begin to consider our
total water footprint – the virtual
water that we consume as well

In the UK, 40 gallons/person/day
vs. virtual use of 1220 gallons

12.
Managing “One Water”
13

The silo thinking of the past has kept
water use and water reuse interests
segregated

We must encourage comprehensive
thinking, planning, and management of
Clean Water
Rain Water
Groundwater
our waters – on the transformational
scale now necessary
WATER
Wastewater
Storm Water
Recycled Water

13.
Rising Water Prices
14

The average family pays less than $20/mo. for
water – far less than monthly electricity, cable TV,
Country
(Cents/Gallon)
internet, or phone service bills

Yet there is strong political resistance to 5% or
10% rate increases – probably less than what
many spend monthly on bottled water!

Recent surveys indicate about a 4-5% increase in
water and sewer rates on average

Cost per 1000 gals. in the US – $0.80 to $5.50

High variability in water prices across the
country, and around the world – Denmark pays
almost 3 cents per gallon, while the U.S. pays
about 4/10 of a cent per gallon

Unfortunately, the U.S. ranks near the bottom in
terms of efficient water usage
Average
Water Price
Denmark
France
Germany
Australia
U.K.
Canada
Czech Rep.
Turkey
Japan
Portugal
Spain
U.S.A.
Poland
Italy
South Korea
Mexico
Russia
China
India
2.96
1.34
1.04
0.82
0.69
0.64
0.53
0.53
0.48
0.47
0.46
0.43
0.39
0.31
0.19
0.19
0.16
0.11
0.05
Per Capita
Domestic Use
(Gallons per Head
per Day)
30.0
61.1
39.7
159.2
36.6
204.7
56.1
62.6
98.2
81.1
90.0
162.1
39.2
127.1
145.3
52.6
96.8
25.0
36.6

14.
The Value of Water
15
Price of Water vs. Price of
Other Consumer Liquids
($U.S./gallon)
Product
TAP WATER
Average Price
$0.0048
Coca-Cola
$3.00
Gasoline
$4.00
Tide Liquid Detergent
$8.50
Imported Beer
$12.00
Evian Bottled Water
$25.00
Starbucks Latte
$22.00
Pepto-Bismol
$65.00
Vicks 44D Cough Syrup
$100.00
American Whisky
$150.00
Visine Eye Drops
$750.00
Revlon Nail Enamel
$1000.00
Good French Wine
$1000.00
Chanel No. 5 Perfume
$45,000.00
Annual Spending in the U.S.
$2 billion a year on Viagra
$13 billion a year on cosmetic surgery
$22 billion a year on mood-altering drugs
$45 BILLION A YEAR ON CLEAN
DRINKING WATER
$52 billion on our pets
$90 billion a year on tobacco products
$93 billion a year on legalized gambling
$160 billion a year on alcoholic beverages
$720 billion a year on military defense

15.
Future Trends
16

The water industry will continue to
experience strong and predictable – if not
spectacular – growth

Water prices will continue to inexorably
rise - sharply in many areas


systems will emerge, by necessity
We must promote a broader and
deeper public understanding of
More efficient pricing and allocation

A key future challenge will be managing and
water issues

In terms of water issues, we must
while simultaneously
think globally, but act locally

pricing water as an economic commodity,
insuring that it
We must develop smarter laws
is available to all
and policies